Regulation

Amendments to FINRA Rules on Trading Pauses Due to Extraordinary Market Volatility and Clearly Erroneous Transactions in Exchange-Listed Securities

Effective Dates: Amendments to Rule 11892 Became Effective September 10, 2010; Amendment to Rule 6121 Became Effective September 14, 2010

Executive Summary

On September 14, 2010, FINRA’s individual stock trading-pause (also called a single-stock circuit breaker) pilot was expanded to include securities in the Russell 1000® Index as well as a pilot list of exchange traded products (ETPs).

On September 10, 2010, amendments to FINRA’s clearly erroneous rules that refine and clarify the process for making clearly erroneous determinations for over-the-counter (OTC) transactions in exchange-listed securities, including events involving multiple stocks, became effective on a pilot basis. Both pilots are set to end on December 10, 2010.